LONDON (Alliance News) - Midatech Pharma PLC said Thursday it will acquire NASDAQ listed oncology supportive care pharmaceutical company DARA BiosSciences Inc for up to USD29.7 million.
It will pay an initial consideration of USD24.0 million through the issue of 5.4 million new shares, based on a Midatech share price of 291 pence, representing around USD1.20 per DARA share. This is a 51% premium over DARA's closing price of USD0.796 per share Wednesday.
Shares in Midatech closed at 293.00 pence Wednesday.
Following completion DARA shareholders would own around 16% of the enlarged company.
Additionally, DARA shareholders will receive one contingent value right per DARA share, which represents a right to additional continent cash payments up to a maximum USD5.7 million based on the performance of some DARA products.
DARA posted a pretax loss of USD9.2 million for 2014 on revenue of USD1.9 million.
The acquisition is expected to close in the second half of 2015.
"The acquisition of DARA provides Midatech with access to an impressive portfolio of products and the potential for a fast-growth revenue stream in our target therapeutic area of oncology. This acquisition also provides us with a commercial footprint in the US, from which we can launch our own products and thus retain more value," said Chief Executive Officer of Midatech Jim Phillips in a statement.
By Hana Stewart-Smith; hanassmith@alliancenews.com; @HanaSSAllNews
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